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HMRC internal manual

Business Income Manual

HM Revenue & Customs
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Meaning of trade: mutual trading and members clubs: members' clubs: incorporated as limited company

Introduction and layout of guidance

As explained in BIM24240, provided that a company is simply a means of enabling the members to conduct a social club, incorporation does not in itself make a members’ club liable to tax on trade profits. The guidance which follows set out the tests which are to be applied in dealing with a club incorporated as a company.

The following guidance explains what is required for an entity, operating through the vehicle of a body corporate, to be accepted as a members’ club. The guidance covers:

BIM24255 Clubs incorporated as limited companies - not paying dividends
BIM24260 Clubs incorporated as limited companies - paying dividends